If you're planning to work overseas in New Zealand, first you need to know about the IRD and New Zealand's tax system.
Photo © Getty Images/Christopher Kimmel / Aurora Photos
Here's the low-down on tax and IRD numbers in New Zealand.
What is an IRD
This three letter acronym means nothing to visitors or people who are planning to do a working holiday in New Zealand. An IRD number is like a tax file number (TFN) in Australia. This is a unique number issued to you by Inland Revenue. Your number will be eight to nine digits and it will never ever change. Yep, not even if you move country, it’s that unique!
Do You Need an IRD?
You should apply for an IRD number when you have your visa if you need one:
- If you earn an income
- Start a business
- File tax returns
- When you ask about your own personal tax.
Basically, if you are planning on working in New Zealand and don't have an IRD, tax will be deducted at a higher rate.
How to Get an IRD
All you have to do is apply online using the Inland Revenue website.
Make sure you read through everything properly in your application so you understand it all.
Tax
Like most countries everyone has to pay tax and its nothing new to New Zealand and the people working there. So when you come and work here, the same applies for you. In New Zealand, you pay tax on a pay as you earn basis (PAYE) and it includes Accident Compensation Corporation (ACC) earners levy. Therefore, if you have an accident while in New Zealand, you can get medical treatment without the costs.
When working as a tourist in New Zealand then you become a non-resident employee, unless you are in the country more than 183 days, then you become a resident.
The amount you pay depends on how much you earn in the year. When working for each employer they will give you a Tax code declaration (IR330) form to fill out .This code will tell your employer the direct amount of tax to deduct from your wages.
Unlike Australia, in New Zealand you pay tax at the correct rate and therefore you don't need to fill out a Tax Return when you leave.
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